province
Let’s Try That Again
Sask Party looking at cuts after last year’s bungled budget
by Stephen LaRose
I’ll say it upfront: I’m at a disadvantage here. I’m writing this story before the Provincial budget comes out on March 24. You’re reading it after budget day.
Since prairie dog hasn’t got their time machine working yet, There’s a danger my hard work might be ruined by events that haven’t happened.
Nothing to do but press on and see what happens.
The last time someone leaked government policy documents to the opposition NDP, the Saskatchewan Party government hired two ex-cops to interrogate civil servants. We don’t know what the Ministry of Finance has done in the wake of the latest leak — this one involving the provincial budget — but if Rod Gantefoer practices what he’s apparently preaching, this time the investigators won’t be on the government payroll — they’ll be under contract.
Big difference, which we’ll explain later.
One thing’s for sure: last week, Gantefoer didn’t discourage NDP reports that the Province would implement a “4X4”policy toward the provincial civil service.
Every year, the Sask. Party says, about six to seven per cent of Saskatchewan’s civil service quits, gets fired, or retires. Why not axe those positions when these employees leave, cutting the civil service by four per cent a year to eliminate from 1,500 to 2,000 civil service positions?
Or, so their thinking apparently goes.
On the surface, it looks like a smart move if they want to cut payroll — and it appears designed as an easy sell to voters.
But easy politics often make for poor policy.
Given his last budget, Gantefoer’s financial plan for the next 12 months will probably divide critics into two camps: those questioning his credibility and those suggesting Gantefoer has little credibility to question. Two years ago, Gantefoer predicted Saskatchewan would earn $2 billion — about 20 per cent of the provincial revenue — from potash. Whoops. The government will instead pay back more than $200 million in royalties to potash mining companies from potash sales that didn’t materialize.
“This government has had an over-optimistic appraisal of its potash revenue stream,” says Simon Enoch, executive director of the Canadian Centre for Policy Alternatives’ Saskatchewan branch.
If you didn’t know better, you’d think Gantefoer and Premier Brad Wall lifted chapters from Naomi Klein’s The Shock Doctrine: The Rise of Disaster Capitalism. Her book suggests conservative governments use real or imagined threats — war, impending economic collapse, 13 men on the field during the last second of the Grey Cup — to spook the public into submitting to their economic and social policies.
It might also be an ‘eff you’ to the civil service, who the Sask. Party hopes voters think are so inessential that they can be removed willy-nilly.
But I say never attribute to malice what can be explained by stupidity.
Basing a fifth of provincial revenues on potash royalties was dumb: the figure, under previous Progressive Conservative and NDP governments, was closer to five per cent. But don’t blame the civil servants. Since the Ministry of Finance was spared the high-level blood-letting that other government departments experienced in Brad Wall’s first days of power, and since some cabinet ministers (coughcoughBill Boydcoughcough) were telling supporters that the revenues could exceed $3 billion, maybe the blame for Gantefoer’s ‘whoopsie’ lies outside of the bureaucratic number-crunchers.
So the Sask. Party taking a 4x4 to the civil service may not be smart from THEIR perspective.
People leaving jobs doesn’t necessarily mean those jobs are redundant. Even if a ruling political party is ideologically committed to the concept of smaller government, the projects governments fund are, for the most part, popular.
“It’s proven historically difficult for governments to cut the actual size of government,” says Ken Rasmussen, professor of public administration at the Johnson-Shoyama Graduate School of Public Policy.
“Public servants deliver services that people like,” says Rasmussen. “And they’re crucial to the functioning of many of our universities, health care facilities, protection services — you name it.”
The Sask. Party government hopes to freeze overall government spending at last year’s levels, while limiting health care spending to a three per cent increase. This means other departments will be facing cuts.
(Can the province hold health care spending to a three per cent increase? Rasmussen doesn’t think so: health budgets, in Saskatchewan’s history as well as in other provinces, traditionally increase six to eight per cent a year).
Trent Wotherspoon is blunter — though that’s his job. “This plan is set up for failure,” says the NDP’s finance critic and Regina Rosemont MLA.
“Many of those positions need to be filled, in health care, child and family services … important roles that need to be preserved,” says Wotherspoon. “So either this plan is being set up for failure, or a lot of services will be cut that people expect government to provide.”
The Saskatchewan civil service has increased over the years: so has overall government spending. Has government spending increased faster than civil service growth?
“That’s a good question: one which I don’t have the information for right in my hands,” Wotherspoon says.
We’ll let him get back to us on that.
Governments fund more than their payroll — they’re also expected to fund capital projects, and programs where people work under contract.
When previous governments — provincial or federal — cut civil service positions, two things happen.
First, people get angry that services they expect are no longer provided. And second — the government likely spends more on contract workers doing the civil service’s jobs than they would’ve if they’d kept the workers on the government payroll.
“If you do find a government that’s committed to reducing the size of the public service, you find that they increase the size of the non-profit sector, the contracting sector, and so on,” says Rasmussen.
A few things may go Gantefoer’s way in the next 12 months. Oil prices currently are at about $82 per barrel, a bit higher than was forecast in last year’s provincial budget. And the Canadian dollar is approaching parity with the U.S. dollar, which benefits exports — at least until the high dollar prices them out of the market.
But it’s clear the government is counting on little more than luck to get through the next couple of years, before the next provincial election.
And luck may not be enough.
Neither will potash revenues. “China, the major buyer of potash, is like the Wal-Mart of resource buyers,” says the CCPA’s Enoch. “They buy in such volume that they’re the ones setting the price — it’s not the other way around.
“I’m continually surprised that conservative governments are painted with the picture of fiscal responsibility,” he concludes. “The evidence seems to shows that, when given the reins of power, they seem to do everything in their power to mess it up.
“It’s just ridiculous, the economic situation [the Sask. Party government] is in when we’re supposedly in the midst of an economic boom.”